Baseball Inks Webcast Deal
Major League Baseball signed a three-year exclusive pact with RealNetworks Inc. to provide audio broadcasts, video highlights and other services on the Web through subscriptions, a deal worth at least $20 million, the two companies said on Tuesday.
Beginning April 1, the start of the 2001 season, baseball will offer live audio broadcasts of all major league games exclusively through RealNetworks' RealAudio software with enhanced features like updated game statistics.
Starting May 1, the league and RealNetworks plan to offer customized video highlights of each game, with video archives of every pitch from every game.
The deal guarantees Major League Baseball $20 million over three years, said Jim Gallagher, a spokesman for MLB Advanced Media, the league's Internet business arm, which he called the agreement the largest Internet deal ever in professional sports.
The features will be available on either http://mlb.com or http://real.com.
Through the league's website, the league will charge an annual fee of $9.95 for the audio webcasting service, but will offer a $10 coupon to buy merchandise through the league's network of websites, Gallagher said.
The league has not determined what the subscription fee for the video service would be.
For Major League Baseball, the deal represents its latest effort make money off the Internet in addition to the traditional channels of ticket sales and advertising, by charging users subscription fees to listen to games over the Internet.
Last June, the league agreed to combine each of the 30 baseball teams' websites into one company called MLB Advanced Media, whose goal was to make money through subscriptions, sponsorships and Internet retail.
"We expect to be profitable in 2003 and with a little luck maybe in 2002," Gallagher said.
For Real Networks, maker of the RealPlayer and RealAudio webcasting software, the deal represents the second major deal with a sports league coming on the heels of a similar agreement with the National Basketball Association.
The RealPlayer is locked in a bitter rivalry with Microsoft's Windows Media Player for dominance in the webcasting software market.
By striking subscription deals with the NBA and Major League Baseball, the company is gambling on establishing subscription revenues through its GoldPass service in addition to its software business.
GoldPass boasts a subscriber base of 175,000 since its introduction in August, up 25,000 since late January when the NBA deal was announced.
From Wired News, http://www.wired.com/news/business/0,1367,42653,00.html
Posted on 27 March, 2001